Leveraged ETF products are a type of financial derivatives that are very popular in traditional financial markets. It is a transactional product that achieves a certain multiple (such as 3 times) of the target daily asset return on the premise of a given target asset (such as BTC). If the BTC price increases by 1%, the net value of the corresponding 3x leveraged ETF product will increase by 3%; while the corresponding -3x product's net value will decrease by 3%.
Leveraged ETFs are perpetual products with no expiry date and prices will not completely return to zero, so there is no risk of liquidation. Investors can buy or sell in the secondary market at any time without paying any margin to achieve the purpose of trading leverage.
Fixed-bar tokens are denominated in USDT and have a trading mechanism similar to coin trading. A leveraged ETF is essentially a unit share of a fixed leveraged fund, where the fund manager ensures that the return of the fund is anchored to a fixed multiple of the return of the underlying asset, and investors can trade shares of the ETF product to receive a specified multiple of the return of the underlying asset.
When the volatility of the underlying asset in the opposite direction exceeds a set threshold, the fund manager rebalances the fund's position by introducing a rebalancing mechanism to ensure that the fund's net worth does not lose more than a certain threshold.
In short, through the risk control measures of the fund manager, ETF investors are relieved of the fear of a position blowout and receive a certain multiple of the return on the underlying asset.
Currently, each pass supports 3x long (BULL) and 3x short (BEAR). You can view the complete list of barred ETFs through [Official website - Quotes Center - ETF Zone].
Leveraged ETFs are emerging financial derivatives. The above content does not constitute investment advice. Please pay attention to risk control.
Leveraged ETF greatly reduces the risk of liquidation and liquidation, but in extreme market conditions, there is a risk of approaching zero and liquidation. Please pay attention to the difference between net value and price to avoid losses.